Faced with the dual threats of a federal receivership and a growing deficit of federal appropriations, in 2018, New York City Mayor Bill DeBlasio enrolled the New York City Housing Authority (“NYCHA”) into the Permanent Affordability Commitment Together (“PACT”). PACT would allow NYCHA to convert its federal Section 9 funding streams into federal Section 8 vouchers and permit the local public housing authority to enter public-private partnerships with private developers. This move would infuse NYCHA with an additional $12.8 billion in funding to counteract its roughly $31.8 billion deficit. However, immediately after the mayor unveiled his plans to pursue PACT, tenant advocates and residents vocalized their concerns that the program would completely privatize NYCHA, dramatically reduce its affordability, and ultimately lead to resident displacement. This Note responds to popular anxiety over NYCHA’s future and evaluates PACT’s likelihood of meeting its stated objectives by using the six-prong “success factor” test derived from public management and engineering literature on public-private partnerships (“P3s”). This Note finds that PACT possesses most of the infrastructure industry’s leading success factors for P3s and does more to shore up NYCHA’s future viability than to jeopardize it. However, it identifies two vulnerabilities: (1) moderate Section 8 subsidy interruption risk; and (2) moderate tenant and local elected official opposition. This Note offers two recommendations to strengthen the program: (1) creation of municipal capital and operational reserve funds for each converted NYCHA development and (2) a scaling of the Chelsea Working Group model across all converted developments to ensure added resident and local representative engagement. Together, these recommendations will reduce resident displacement risk and increase the likelihood that NYCHA tenants will capture greater shares of the city and state budget to further stave off the authority’s future obsolescence.
No Pact with the Devil: Defending & Strengthening New York City’s Permanent Affordability Commitment Together (PACT) - P3,
30 J. L. & Pol'y
Available at: https://brooklynworks.brooklaw.edu/jlp/vol30/iss2/7